The Fiscal Stimulus: Lessons from Katrina, Iraq, and the Big Dig

Linda Bilmes presented an interesting paper (not online) at the AEAs looking at the fiscal stimulus in light of Katrina, Iraq and the Big Dig. Here are some key grafs:...We will be attempting to ramp up spending in a very rapid way in a government bureaucracy not set up to deal with this kind of effort. In any organization that starts to increase spending very rapidly there are risks of waste, fraud and inefficiency....A good play to start looking for lessons is by analyzing the three biggest recent examples of heavy government spending on infrastructure: the Iraqi reconstruction effort, Hurricane Katrina reconstruction, and the Big Dig artery construction in Boston. Let me start by pointing out that all of these were plagued by a number of serious problems.Iraqi reconstruction: [T]he Special Inspector General for Reconstruction, Stuart Bowen,...has found that the effort has been riddled with cost overruns, project delays, fraud, failed projects and wasteful expenditures...even though the first tranche of $19 billion in Iraqi reconstruction money became available in October 2003, the Defense Department did not issue the first requests for proposals for this money until 10 months later...Hurricane Katrina: ...the US has appropriated, over $100 billion in short and long term reconstruction grants, loan subsidies [etc]...GAO found that FEMA made over $1 billion--or 16% of the total in this particular category--in fraudulent payments...items like professional football tickets and Caribbean vacations.The Big Dig: ...the largest single infrastructure project in the US...many lessons on how not to run a project...officially launched in 1982, but it did not break ground until 1991, due to environmental impact statements, technical difficulties and jurisdictional squabbles...not "completed" until 2007.Bilmes is the co-author with Joseph Stiglitz of The Three Trillion Dollar War.

How much does the federal government subsidize the cost of college in the United States?
That's the subject of today's chart, where we've taken historical data from the White House's proposed budget for Fiscal Year 2011 and plotted it over time. The chart below shows both nominal and inflation-adjusted figures for all federal outlays for higher education since 1962, with projected values through 2014.

MUMBAI: Some of the bulge-bracket global investors are betting on India's affordable housing story with the country's leading mortgage lender HDFC rolling out its $1-billion offshore fund to finance such projects. The world's second largest sovereign wealth fund the Abu Dhabi Investment Authority (ADIA), is one of the investors, according to two persons close to the development. Two European pension fund pools have also committed investments.

The delays and cost overruns plaguing the restoration of the Bluenose II stem from Nova Scotia’s decision to hand the job to a government department that had little experience managing construction projects, the province’s auditor general says.
In a report released Wednesday, Michael Pickup says the Heritage Department’s supervision of the project was undermined by a lack of planning and weak management.

You are supporting the habits of the rich in more ways than you know, including their love of water views.
Readers may recall that we wrote about the Biggert-Waters Act, a bill to address rising losses in a Federal flood insurance program that had run on a self-supporting basis until the late 2000s. As New Jersey Spotlight explained: